The failure of a workhorse Proton rocket after launch onMonday caused the multimillion-dollar loss of Indonesia'sTelkom-3 and Russia's Express-MD2 satellites, according toRussia's space agency.

Russian space agency Roskosmos said an engine failure in therocket's upper stage, called the Briz-M, meant the craft wentinto the wrong orbit. A similar problem caused the loss of a$265 million communications satellite last year.

"I don't know the reason for the loss of our satellites -whether it is the upper stage, mechanical damage, elementarynegligence or everything together - but we cannot stand this anylonger," Medvedev said at a televised government meeting.

"We are losing our authority and billions of roubles."

Medvedev said he would hold a meeting on the subject nextweek and ordered government officials to look into recentfailures. "They must report their recommendations on who topunish and what to do further."

Moscow is struggling to restore confidence in its spaceindustry after a series of mishaps last year, including thefailure of a mission to return samples from the Martian moonPhobos.

Such failures for Russia, which conducts 40 percent ofglobal space launches, may undermine its standing in the market,strengthening competitors such as Europe's Ariane rocket.

Telkom-3 was the first satellite Jakarta had purchased fromMoscow, built by Russia's ISS-Reshetnev with communicationequipment made by French-led satellite maker Thales Alenia Space. Express-MD2 was a small communication satellite, madefor the Russian Satellite Communications Company.